OLIVER FRANKEL AND SUSAN RYAN. Monthly housing digest – Jan/Feb 2019

This is the first of what is intended to be a monthly digest of interesting articles, research reports, policy announcements and other material relevant to housing stress/affordability and homelessness – with hypertext links to the source material. While the focus is on Australia, the Digest may occasionally include items of significant interest from overseas jurisdictions. See for example the piece about Microsoft in this Digest.

This edition is re-posted from Thursday 21 February, and in future will appear on the first Saturday of every month.

The January 2019 Productivity Commission Report on Government Services[PC report – section on Housing and Homelessness] reveals ongoing high levels of “rental stress” for lower income earners renting in the private sector, and the extent to which we are continually failing to meet the needs of vulnerable people in accessing public housing. Not surprisingly, NSW and Victoria have the worst records.

Why are so many older Australian women becoming homeless? [article by Pro Bono Australia] Recent ABS statistics show a 42% increase since 2011 in people over 65 paying unaffordable rents in Australia. Women over 55 are the fastest-growing category of people experiencing homelessness.

Microsoft pledges to invest US$500m in affordable housing in its home town of Seattle. [article in The Fifth Estate] The funding, mainly in the form of subsidised loans, is seen as a gesture that recognises the plight of those lower income earners who have been priced out of the local housing market by Microsoft’s own highly-paid employees trying to live close to work. A good example to follow?

A recently released annual survey of middle-income house price affordability rated all 5 of the Australia’s major housing markets “severely unaffordable”, despite recent house price reductions. Sydney was ranked Australia’s least affordable market, and third worst of all international markets surveyed, followed closely by Melbourne. The 15thAnnual Demographia International Housing Affordability Survey (2019) rated affordability across 91 cities of more than 1m people in 8 countries including Australia.

According to Leith van Onselen (Macrobusiness blog), mass immigration is driving up Sydney rental stress and homelessness. The article quotes ABS statistics showing that out of Sydney’s population increase of 101,600 in 2016/7, some 84,700 came from net overseas migration. The article references a report from UNSW, commissioned by the Everybody’s Home Campaign, which highlights that Western Sydney is Australia’s epicentre of rental stress.

A December 2018 research paper from AHURI identifies “The potential for new technologies to disrupt housing policy”. The most significant opportunities, potentially also benefiting social and affordable housing, include improved efficiency in matching housing supply and demand through the use of digital platforms, improved development processes, the use of blockchain systems and better analytics harnessing big data. The study also points to the challenges of new technologies, including for example digital disruptions such as Airbnb.

A conceptual analysis of social housing as infrastructure (AHURI: Feb 2019). To create a more viable basis for private investment in social housing, policy makers need to make better use of cost-benefit analysis for making the business case for social housing, while not overlooking other aspects that are not easily quantified or monetised.

With property prices increasing over the longer time frame and the residential investment sector bearing all the land tax, the annual charge for even a small inner city property can exceed $10,000. How much longer can this sector bear the burden for raising all the land tax on private dwellings?

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